By Scott Wright

AN AWARD-WINNING hotel and restaurant on the Isle of Skye has secured a lifeline funding deal after bookings were wiped out by the coronavirus.

Kinloch Lodge, a fixture on Skye for more than 50 years, saw 1,200 bookings cancelled for the period covering March to June after travel restrictions were imposed to halt the spread of the pandemic.

The 19-bedroom hotel, which relies on international visitors for around 75 per cent of bookings, was forced to temporarily close after Scotland moved into lockdown, with all 32 staff placed on furlough.

However, in a vote of confidence for Scotland’s beleaguered tourism industry, the family-run business has clinched a “six-figure” loan from Bank of Scotland, giving the hotel sufficient “breathing space” to continue to trade until travel restrictions are lifted.

The funding, which was provided under the UK Government’s Coronavirus Business Interruption Loan Scheme, will also allow the luxury venue to pay suppliers, though the responsibility of servicing extra debt will hinder the hotel’s ability to reinvest in the coming years.

Kinloch Lodge, which overlooks Loch na Dal, is frequently used by guests as a base to explore local hillwalking trails and fishing spots. It has a string of accolades to its name, including being named luxury hotel of the year in The Good Hotel Guide 2019 Cesar Awards.

Director Isabella Macdonald said securing the loan was a big relief after being “terrified” by the prospect of a previously strong business having no income at all when the pandemic struck.

“Added to which, you are coming out of the winter [with] suppliers to pay,” said Ms Macdonald, who felt the weight of responsibility to the hotel’s 32 staff, whom she is committed to employing all-year round.

“We have a lot of overheads and you suddenly think, oh my goodness, this is terrifying.”

Ms Macdonald said: “Thanks to the support from Bank of Scotland, we’ve been given the breathing space needed to allow us to pay our suppliers and overheads, and we now look forward to welcoming our team and guests back when the restrictions are eased.

“Despite our bookings normally being largely made up of international travellers, we’re hopeful for a rise in UK staycations and a busy end to the year for our business.”

The boost for Kinloch Lodge comes at a critical time for the Scottish tourism industry, which seems certain to miss a significant part of the peak summer season as a result of lockdown and social distancing measures.

Ms Macdonald, who has run the hotel for eight years, revealed Kinloch had also been successful in receiving support under the Scottish Government’s £45 million Pivotal Enterprise Resilience Fund, which she said would help to prepare the business for reopening.

But while Ms Macdonald said she was “grateful” for the assistance, she questioned the decision to limit separate coronavirus grants for firms in the retail, leisure and hospitality sectors to those with property rateable values lower than £51,000.

The Scottish Tourism Alliance warned last week that the policy leaves hundreds of pubs, hotels and visitor attractions facing closure because they have received no support but still face significant monthly outgoings. With so many medium-sized businesses missing out, Ms Macdonald said it was a “mistake” to set the threshold so low.

The hotelier, who did not qualify for the rates-based grant, noted: “So many people fall through the cracks. To cover absolutely everyone... is a tricky one to get right.”

Ms Macdonald would like Scottish ministers to set a definitive date for the tourism industry to reopen, noting that operators were waiting on guidelines on what is expected from them. She said Kinloch is mindful of reopening in a way that protects guests and staff and is responsible towards the community on Skye.

“There is a balance here... the risk will be with us for a long time,” Ms Macdonald said.

Barrie Aird, relationship manager at Bank of Scotland, said: “Kinloch Lodge is a prominent Highland business that’s been operating for almost 50 years.

“Many companies like this in the tourist industry have been hugely impacted by the restrictions imposed during the pandemic and are learning to adapt and adjust to the climate.”